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Hilton carefully announces ‘repositioning’
April 20 2011

Hilton Hotels & Resorts introduced a new lobby concept Tuesday, the early phase of a three-year overall plan that will lead to “tough” property-improvement plans but increased brand relevance.

By Jason Q. Freed
Contributing Editor, Tech Impact Report

Reimaging. Rebranding. Repositioning. Relaunch.


Whichever terminology hotel executives choose, announcing the implementation of new brand standards to modernize a tired brand can stir a range of reactions. For travelers, those terms are usually synonymous with upgraded amenities that will improve their stay. Owners tend to associate those words with additional capital requirements that could strain the wallet.

Those ‘R’ words certainly are not new; in fact, it seems a slew of hotel brands have embarked on official repositioning strategies in the past decade, launching marketing campaigns to sell said changes to the ownership community and the consumer alike.

Tuesday in McLean, Virginia, Hilton Hotels & Resorts executives announced in a somewhat roundabout way that the brand is in the early stages of a three-year repositioning that will lead to a “tough” property-improvement plans but will, in the end, make the brand relevant again.

“Three years down the road you’re going to see a brand transformed,” said Dave Horton, global head, Hilton Hotels & Resorts.

Horton and Larry Traxler, SVP of global design services for Hilton Worldwide, unveiled a renovated lobby at the Hilton McLean Tysons Corner—including a full-service restaurant, a technology lounge and an 18-hour bar—that showcases the first part of a multi-phase transformation of Hilton’s DNA. Later phases of the repositioning will include renovated guestrooms and public spaces, recreating a full-service dining option and altering signage, Horton said.

Specifics on the new lobby concept are outlined in a video news release from Hilton.

“As we bring this refreshed, smart design, our customers are going to react to that and they’re going to want it more. That drives up your pricing, improves performance, gets more market share, more relevance,” Horton said. “So yes there’s a mandate, and every brand that stops thinking about the future and being more relevant is a dying brand.”

Repositioning strategy
Having benefitted from watching competitors relaunch their brands in recent years, it was clear Tuesday that Hilton executives had taken notes. Horton hit on key phrases like “driving rate” and “improving loyalty” but steered away from setting specific goals. He chose not to put a timeline on how long the repositioning would take and danced around questions about how much it would cost—to each individual owner and to the company as a whole.

 

Larry Traxler (left) and Dave Horton unveiled a renovated lobby at the Hilton McLean Tysons Corner that showcases the first part of a multi-phase repositioning of the Hilton Hotels & Resorts brand.

 

 

“On rate premium and cost, it really is a market-relevant situation,” Horton said. “What does the market bear and what is the opportunity? Every market is different.”

The smartest diversion from your typical brand relaunch, though, was Hilton’s strategy to avoid the word “prototype.” Horton stressed that the renovated lobby and guestrooms in McLean won’t be carbon-copied throughout Hilton’s 530 worldwide properties, but a set of guidelines will be created and communicated to owners as they enter the traditional PIP cycle. Owners are free to utilize their own design firms and customize casegoods and color schemes. The structure of the new lobby and guestroom concepts will be mandated and presented in a “manual.”

There are 130 Hilton Hotels & Resorts properties under development globally, all of which are being built to the new brand standards, Horton said. Another 118 are undergoing full-scale renovations—lobby, restaurant, guestrooms.

“Just today, at this moment in time, 40% of our brand is transforming under our current thinking,” Horton said.

Horton said Hilton has improved the process in which renovations are managed by offering turnkey solutions that can be implemented whenever the owners face a PIP. Rather than letting the owner interpret what solutions are best, Horton said Hilton will offer proper oversight and well-written design standards to limit mistakes.
 
“We’re definitely raising the bar—they’re tough PIPs,” he said.

Horton said ownership response thus far has been “very, very positive.” Hilton brand executives worked with a 25-member ownership board as it developed the strategies.

“We give them the road map confidentially, where we’re going, and that’s where a lot of input comes from,” he said. “There’s a lot of dialogue back and forth around that. We feel very confident that what we’re presenting here, our owners will support whole-heartedly.”

 

 

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